Terror suspects could be convicted on the evidence of 'electronic eavesdropping' of phone calls and emails under sweeping moves to combat the threat of an al-Qaeda atrocity.

In a blunt admission that the risk of attack remains 'real and serious', Home Secretary David Blunkett will pledge a massive staffing boost for MI5. Priorities will include linguists, translators and surveillance to help infiltrate overseas-sponsored terror networks in Britain.

Blunkett will also flesh out highly controversial plans for new anti-terrorism powers which would see suspects convicted on lower standards of proof than the criminal courts and of crimes not yet even committed - such as an intent to execute a suicide bombing.

But in a gesture to liberal opinion anxious about threats increasingly to detain terror suspects indefinitely without trial, he will make it clear that the Home Office is also seriously reviewing the use of 'intercepted communications' as evidence in court.

'We are testing certain types of intercepts against different case studies to see how they would work in real cases,' said one Home Office source. 'It is about making these hearings more effective and making more charges stick. Are there ways in which we could loosen up what is admissible in court?'

The moves follow news that five of the nine Britons held at US camp in Guantanamo Bay, Cuba, will be released and will send reassuring signals to the White House that Britain takes the terrorist threat seriously.

However, the package risks provoking uproar at home, with lawyers yesterday demanding assurances that evidence extracted under duress could not become admissible under the new system. Gareth Peirce, solicitor to several Guantanamo detainees, said British intelligence officers were known to have travelled to the camp to interrogate prisoners.

'On the face of it, we are squeamish about the treatment of prisoners at Guantanamo Bay, but we are still quite happy to use the product of interviews with the men being kept there,' said Peirce. 'In this we are complicit in the illegality.'

She warned that evidence extracted under torture abroad could be admitted into secret hearings now taking place into the 14 foreign nationals held without trial in Britain on suspicion of al-Qaeda involvement.

On Wednesday Blunkett is expected to publish his proposals on a new system for trying terrorist suspects, when he responds formally to the Newton Committee set up to review his powers under the Anti-Terrorism, Crime and Security Act 2001.

It demanded he find alternatives to the indefinite detention of foreign nationals considered a threat to national security, such as the Belmarsh 14, which could also apply to Britons.

Blunkett's first efforts at explaining his thinking, during a trip to India earlier this month, led Labour peers to condemn him as a 'shameless authoritarian'.

However a liberal consensus is now growing over allowing intercepted communications - so-called 'electronic eavesdropping' on phone calls - to be admissible in court. Lawyers argue it offers light at the end of the tunnel for some of the Belmarsh 14, since it could enable cases to come to court.

Its use was backed by the Newton committee, a panel of senior MPs and peers asked by Blunkett to review his anti-terrorism powers last year, which concluded that lifting the blanket ban could be an alternative to internment.

The stumbling block is the security services, which have long argued the use of phone taps and intercepted evidence in courts would jeopardise operations.

Blunkett's former special adviser Nick Pearce, now director of the Blairite thinktank the Institute for Public Policy Research, said the closed nature of the court system proposed by his boss could override such objections: 'There must surely be better ways of securing convictions, if you have got evidence from the security services and others that these people are a risk.

'If we are bringing these people back into the criminal justice system I think it has got to involve some element of putting security service material before the courts.'

Mark Oaten, the Liberal Democrat home affairs spokesman, backed the idea, adding: 'We would feel more comfortable with looking at different forms of evidence to be used as part of a trial.' Home Office sources stressed last night that the use of intercept evidence was not a 'panacea for all ills.'

Peirce last night demanded assurances that the new courts would not use evidence extracted under torture. A British intelligence officer admitted in July during secret hearings concerning the Belmarsh inmates that 'we might factor in' such evidence to intelligence assessments, which could then be presented to the hearings.

The anti-terrorism proposals will be seen in part as an attempt to reassure Washington of British commitment to the war on terrorism. It is unlikely however that the new system would be in place in time for Britain to offer to try the four remaining Guantanamo detainees whom the US refuses to release.

Talks between London and Washington will now centre on trying to arrange a form of trial in the US for the four acceptable to British sensibilities.

Blunkett is expected to backpedal on threats of internment for Britons on Wednesday, making clear that would only be likely to be exercised in the wake of a major terrorist atrocity.

He will say however that the latest assessment of the terror threat still indicates a 'national public emergency', and unveil funding for another 1,000 MI5 staff over the next three years.